Leyte’s inflation rate decelerates at 4.9 percent in March 2023

Leyte’s inflation rate slowed down at 4.9 percent in March 2023. Leyte’s inflation rate during the same period last year was higher at 5.5 percent. Likewise, the region’s inflation rate declined at 5.9 percent in March 2023 from 6.3 percent in February 2023. Among all the provinces and HUC in the region, only Northern Samar, Western Samar, and Biliran manifested an increase in their respective inflation rates in March 2023.

The decline in Leyte’s March 2023 inflation rate was due to the downtrend in annual rate of change of CPI of three (3) major commodity groups. The inflation rate for Food and Non-Alcoholic Beverages decreased at 7.7 percent in March 2023 from 8.3 percent in February 2023. This was driven by the slower rate of increase in prices of Meat and Other Parts of Slaughtered Land Animals, Fish and Other Seafood, Milk, Other Dairy Products and Eggs, Vegetables, Tubers, Plantains, Cooking Bananas and Pulses, Sugar, Confectionery and Desserts, Coffee and Coffee Substitutes, and Other Non-alcoholic Beverages. Likewise, Housing, Water, Electricity, Gas and Other Fuels registered a decrease in its inflation rate at 2.0 percent in March 2023 from 3.5 percent in February 2023 due to the slower rate of increase in prices of Security Equipment and Materials for the Maintenance and Repair of the Dwelling, Electricity, and Liquid Fuels, and the decrease in prices of Gas. Further, Transport recorded a decrease by 4.6 percentage points in March 2023 at 0.7 percent from 5.3 percent in February 2023 caused by the decrease in prices of Fuels and Lubricants for Personal Transport Equipment. 

On the other hand, six (6) major commodity groups recorded an increase in their respective inflation rates in March 2023. Alcoholic Beverages and Tobacco recorded a 5.6 percent inflation rate in March 2023 from 5.2 percent in February 2023 due to the faster rate of increase in the prices of Spirits and Liquors and Tobacco. Clothing and Footwear likewise registered an increase at 1.9 percent in March 2023 from 1.8 percent in February 2023 due to the faster rate of increase in prices of Garments. Furnishings, Household Equipment and Routine Household Maintenance recorded an increase at 3.4 percent in March 2023 from 2.5 percent in February 2023 caused by the faster rate of increase in prices of Furniture, Furnishings, and Loose Carpets, Major Household Appliances, whether electric or not, Small Household Appliances, and Non-durable Household Goods. Health posted an increase at 3.0 percent in March 2023 from 2.2 percent in February 2023 due to the faster rate of increase in prices of Medicines, Medical Products, Preventive Care Services, and Diagnostic Imaging Services and Medical Laboratory Services. Recreation, Sport and Culture recorded an increase in its inflation rate at 1.9 percent in March 2023 from 1.5 percent in February 2023 due to the faster rate of increase in prices of Garden Products, Plants and Flowers, Pets and Products for Pets, and Stationery and Drawing Materials. Furthermore, Personal Care, and Miscellaneous Goods and Services posted an increase in its inflation rate at 4.0 percent in March 2023 from 3.7 percent in February 2023 caused by the faster rate of increase in prices of Other Appliances, Articles and Products for Personal Care and Hairdressing Salons and Personal Grooming Establishments.

The four (4) other major commodity groups maintained their inflation rates from their previous months’ rate. These are Information and Communication with 0.4 percent; Education Services with 0.9 percent; Restaurants and Accommodation Services with 4.5 percent; and Financial Services with zero percent inflation rate. 

The inflation rate is the general rise in prices over a period. It indicates how fast or how slow price changes over two-time periods. Contrary to common knowledge, low inflation does not necessarily connote that prices are falling instead; it means that prices continue to increase at a slower rate. It is a derived indicator of the Consumer Price Index (CPI).

 The CPI is a measure of change in the average retail prices of goods and services commonly purchased by a particular group of people in a specific area. The overall CPI in Leyte for March 2023 was 119.4. This implies that the average retail price of goods and services in Leyte is 19.4 percent higher than the average retail prices in 2018 (base year).

Purchasing Power of Peso (PPP) increases at 84 centavos in March 2023

The Purchasing Power of Peso (PPP) in Leyte increased to 84 centavos in March 2023 from 83 centavos in February 2023. Meanwhile, the PPP in the region retained at 83 centavos in March 2023. The 84 centavos purchasing power of the peso in Leyte indicates that the same basket of goods and services worth 84 pesos in 2018 (base year) is worth 100 pesos during the reference period.

TECHNICAL NOTES

Rebasing of the CPI is necessary to ensure that this barometer of economic phenomena is truly reflective of current situation. Consumer taste, fashion and technology change over time causing the fixed market basket of goods and services to become outmoded. To capture such changes for a more meaningful price comparison, revision or updating of the fixed market basket, the sample outlets, the weights and the base year had to be done periodically. 

BASE PERIOD – refers to the reference period of the index number. It is a period at which the index is set to 100. Current base period is 2018. 

MARKET BASKET - refers to a sample of goods and services used to represent all goods and services bought by a particular group of consumers in a particular area. 

WEIGHTS - The weights for the 2018-based CPI were derived from the expenditure data of the 2018 Family Income and Expenditure Survey (FIES). The weight for each item of expenditure is a proportion of that expenditure item to the total national expenditure. The total (all items) national expenditure weights is equal to 100. 

MONITORING OF PRICES - is to establish baseline information for prices of the items in the base year and monitoring of the prices of the items on a regular basis. Except for Food, Beverage and Tobacco which is monitored on a weekly basis in NCR, price collection is done twice a month. First collection phase is done during the first five days of the month while the second phase is on the 15th to 17th day of the month. 

COMPUTING THE CPI - The formula used in computing the CPI is the weighted arithmetic mean of price relatives, a variant of the Laspeyres formula with fixed base year period weights. 

RETAIL PRICE - refers to the actual price at which retailers sell a commodity on spot or earliest delivery, usually in small quantities for consumption and not for resale. It is confined to transactions on cash basis in the free market and excludes black-market prices and prices of commodities that are on sale as in summer sales, anniversary sales, Christmas sales, etc. 

CONSUMER PRICE INDEX – is a measure of change in the average retail prices of goods and services commonly purchased by a particular group of people in a particular area. 

INFLATION RATE – refers to the annual rate of change or year-on-year change in CPI. 

PURCHASING POWER PESO – it is a measure of how much the peso in the base period is worth in another period. It gives as indication of the real value in a given period relative to the peso value in the base period.

SGD. SHERYL ANN A JAMISOLA
Chief Statistical Specialist